EXCLUSIVE Chinese fashion retailer SHEIN revives plan for New York listing in 2022-sources

In this illustrative photo taken on October 13, 2020, a keyboard and carriage are seen in front of the Shein logo displayed. REUTERS / Dado Ruvic / Illustration

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HONG KONG / SINGAPORE, Jan.25 (Reuters) – Chinese fashion retailer SHEIN is resuming plans to go public in New York this year and its founder is considering a change of citizenship to circumvent the stricter rules proposed for offshore IPOs. in China, two people familiar with the matter said.

It wasn’t immediately clear how much the company was trying to raise since its New York debut.

The initial public offering (IPO), if finalized, would be the first major equity deal by a Chinese company in the United States since regulators of the world’s second largest economy stepped in to tighten oversight of such quotes to July.

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SHEIN, founded by Chinese entrepreneur Chris Xu in 2008, began preparing for an IPO in the US about two years ago, but shelved the plan in part due to unpredictable markets amid mounting US-China tensions, they say the sources.

Both sources declined to be named as the plans are confidential. A spokesperson for SHEIN said the company had no plans to go public.

The Nanjing-based company is one of the largest online fashion markets in the world targeting overseas consumers. The United States is its largest market.

Sources said SHEIN founder Xu was looking to Singapore citizenship in part to circumvent China’s new and stricter rules on overseas listing. The change of citizenship, if requested and successful, would facilitate the path to an offshore IPO, they said.

Neither Xu nor any other SHEIN executives have applied for Singaporean citizenship, the company spokesman said, without elaborating on. Xu did not respond to Reuters questions sent through this spokesperson.

The new rules issued by the Chinese cyberspace administration and the offshore listing filing regime to be finalized by the Chinese securities regulator will make the US listing process more complicated, if not longer, for Chinese companies.

The securities regulator’s draft offshore listing rules is aimed at companies where the majority of senior executives are Chinese citizens or reside in China, or whose main business activities are conducted in China.

JUMP OF EVALUATION

SHEIN ships to 150 countries and territories from its many global warehouses, according to its website.

It made sales of around 100 billion yuan ($ 15.7 billion) in 2021, taking advantage of the pandemic that has displaced global consumption online, said one of the sources and another person familiar with the matter. His valuation was around $ 50 billion in early 2021, they said.

The valuation is estimated to have nearly doubled in the past year, one of the top two sources said.

The company, whose investors include Sequoia Capital China, IDG Capital and Tiger Global, was valued at $ 15 billion in its latest funding round in August 2020, according to data from CB Insights.

According to Coresight Research, SHEIN’s estimated sales in 2020 increased 250% from the previous year to $ 10 billion, with more than 2,000 articles added weekly to its website.

The SHEIN spokesperson said that, as a private company, it did not disclose financial data.

SHEIN hired Bank of America (BAC.N), Goldman Sachs (GS.N) and JPMorgan (JPM.N) to work on the IPO, the source with knowledge of the company’s valuation and another person familiar with said. with the question.

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Reporting by Kane Wu and Scott Murdoch in Hong Kong and Fanny Potkin in Singapore; Additional reporting by Sophie Yu in Beijing; Editing by Sumeet Chatterjee and Stephen Coates

Our Standards: Thomson Reuters Trust Principles.

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